Guy sues gal in England for defamation because gal says in her book that guy funds terrorism. Guy wins defamation case in England (stopping gal from speaking ill of guy) which does not have the First Amendment protections that make it much more difficult to win defamation cases in the United States. Gal then files lawsuit in New York federal court for a declaration that (1) guy cannot win any defamation case against her in the United States, and (2) the English defamation judgment cannot be enforced here in light of our superior free speech values. Guy wins in the Second Circuit.
The case is Ehrenfeld v. Mahfouz, decided on March 3, 2008. The case has a complicated history. Mahfouz first prevailed against Ehrenfeld in England, taking advantage of England's notorious pro-plaintiff libel laws. Ehrenfeld then sued in the Southern District of New York in a pre-emptive strike, seeking a court order that she cannot be sued for defamation in this country. The problem is that Mahfouz's only connection to New York is that Ehrenfeld lives in New York and her obligation to stop disparaging Mahfouz in England is carried out in New York.
Ehrenfeld is a sympathetic party here. She describes the case as "libel tourism," where libel plaintiffs sue writers in jurisdictions that are hostile to freedom of speech, in this case, England. They then use those judgments elsewhere. But the laws in New York, binding on the Federal courts, do not allow New Yorkers to sue outsiders with little if any connection to New York. When the Second Circuit got the case a few years ago, it asked the New York Court of Appeals to rule on this matter which truly requires an expert in New York law to resolve the issue. While defamation judgments are difficult to win in New York, the judges on the New York Court of Appeals would probably win a defamation lawsuit if someone accused them of faulty knowledge of New York law. They advised the Second Circuit that New York law cannot allow a suit like this to go forward since Mahfouz has little, if any, connection to New York. On the basis of that ruling from the New York Court of Appeals, the Second Circuit dismisses the case.
Any law student will tell you that nothing is more boring than New York civil practice, particularly the rules governing "long-arm jurisdiction," which addresses when a New Yorker can sue an out-of-stater in New York courts. But the broader implications of this case have raised enough concern about liability for provocative New York writers that several media bigwigs filed advisory briefs with the Second Circuit on this issue (favoring Ehrenfeld) and the New York Legislature is considering amending the long-arm statute to authorize lawsuits like this. That pending legislation is no reason for the Second Circuit to delay ruling on this case, and the Court points out that if the law is eventually changed, Ehrenfeld can sue Mahfouz again, or re-open this judgment.